Dixon Technologies - IT Hardware To Define The Next Leg Of Growth: Nirmal Bang

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Nirmal Bang Report.We recently met Mr. Saurabh Gupta – Chief Financial Officer and he explained the laptop landscape in India along with the opportunity available for Dixon Technologies Ltd. Dixon has been selected as the laptop and tablet manufacturing vendor for Lenovo under the IT Hardware production linked incentive 2.0. The company is expected to put up capex of ~Rs 2.5 billion, with manufacturing expected to start by Q1 FY25. They currently manufacture IT Hardware products for Acer. With production expected at ~1 million units in FY25 (for both Lenovo and Acer) and to double from thereon in the coming years, revenue from this segment is expected to scale up significantly from ~2% levels in FY23 to ~10% by FY26. We upgrade to 'Buy' with a revised target price of Rs 7,320. We have increased our multiple from 41 times to 48 times and have valued Dixon on FY26E earnings per share. While we were conservative earlier, new developments such as bagging manufacturing contracts for ~30% market size of IT hardware in India, along with consistently increasing wallet share with existing customers and on-boarding of new customers has given us comfort to increase multiples by ~17%..Click on the attachment to read the full report:.Small-Cap’s Upper Size Limit Eclipses Global Standards To Hit Rs 300 Crore: ICICI Securities.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Dixon Technologies - IT Hardware To Define The Next Leg Of Growth: Nirmal Bang

Dixon has been selected as the laptop and tablet manufacturing vendor for Lenovo under the IT hardware production linked incentive 2.0.

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